The word on the street is that buying art is on the up. Galleries selling traditional art, that’s to say paintings, are noticing demand is outstripping supply at the high end of the market. As Gregor Muir, director of Hauser & Wirth art gallery in central London, who specialise in contemporary artists from America and Europe, says, “I think people have noticed a rapid increase in the sale of contemporary art. The key thing is there are a lot of people who look at the art world as interesting to invest in, but there’s a limited amount of work. The art market is very competitive.”

Louise Hayman is one of two curators at Store Gallery in Hoxton. She and fellow curator, Niru Ratnam set up the gallery in 2003, and Louise comments, “In that time we’ve expanded quite dramatically which is to do with the booming market.” Add to that the launch this year of The Art Trading Fund, an art hedge fund, and you might ask yourself, is this something I should consider getting into?

But is buying art, investment or pleasure, or both? And how does one start?

The Store Gallery has a stable of 12 artists all working on the cutting edge of contemporary art, and Hayward says, “On the whole we don’t sell to people for investment. You recognise them because they don’t really care about the work.” But she concurs, “Art is a good investment.” Store’s artists are varied. At one end of the scale there’s Dan Holdsworth a photographer, at the other, Ryan Gander an installation artist, both of whom have exhibited at Tate Modern. The good news is, whether for investment or pleasure, prices start at £3,000, bringing it within the reach of the budding investor or collector.

For those with investment hats and fat wallets names like Lucien Freud, Mark Rothko and Jackson Pollock will have appeal. But this art fetches high prices. For instance at auction in New York, Rothko sold for $73 million. However, collectors have to start somewhere. And artists can appreciate in value.

“You don’t need a lot of money to buy prints. Some print makers are very talented and prices can be as low as £50. But go for a small print run such as 50, or 25 is even better.” Alvin Hall, collector

Peter Doig’s ‘White Canoe’ sold at Sotheby’s in New York for $11.3 million, breaking records for the highest selling painting by a living European artist. Big money. But listen to collector Alvin Hall. He’s been seriously buying art for over twenty years. When he says some years back he bought a ‘Doig for under $1,000’, you begin to realise art’s potential as investment. However, Hall who’s an independent financial educator, is quick to point out, “Buying art for investment you have to pay top dollar and not buy an up-and-coming artist as an investment.”

But Hall will purchase from new artists after a honeymoon period. He says, “I rarely buy from first shows. I keep an eye on them and may buy from the second or third show.”

Hall, who presented a segment of The Royal Academy Summer Exhibition with Laurence Llewelyn Bowen on television this year, believes exhibitions are good places to start collecting art such as prints. He says, “You don’t need a lot of money to buy prints. Some print makers are very talented and prices can be as low as £50. But go for a small print run such as 50, or 25 is even better.” And he comments, “It’s good to focus on small paintings and works on paper where you often buy significant works for a few thousand pounds.”

Muir concurs that visiting exhibitions is crucial to developing a collector’s eye. He says, “Art is an area where you need an amount of expertise. It’s not just putting on the art investment hat and running around galleries. The art market is an intricate mechanism. It’s largely knowledge based and there’s a certain amount of relationship building going on.”

“Art is an area where you need an amount of expertise. It’s not just putting on the art investment hat and running around galleries. The art market is an intricate mechanism.” Gregor Muir, Hauser & Wirth

Hall agrees that you need to know what you’re looking at and believes you ‘have to love art in order for it to become a good investment’. And he says, “You have to look and look and look.” Every Friday he visits galleries, getting acquainted with the work and building relationships with gallery owners and directors. And it pays off. He bought two drawings by Julie Mehretu for approximately $1,200 which now would fetch between $20 and $30,000. He admits, “Art is not democratic, you want the best prices.”

So if art is a passion, which could in turn become an investment, the trick is to nurture your talent for recognising what touches you deeply. There are plenty of collectors groups to join. Galleries like The Serpentine in London have a collectors circle which organises trips to art galleries and artists studios. They also hold free art talks on a Saturday morning. There’s the Own Art scheme where you can borrow up to £2,000 interest free to purchase contemporary works of art and craft at over 250 participating venues countrywide, and pay back in 10 monthly payments. And October sees the opening of Frieze Art Fair, a must for every art lover. It features over 150 of the ‘most exciting contemporary art galleries in the world.’ Never has it been so easy to indulge in art, and who knows, make a good investment.

Hauser & Wirth, 196A Piccadilly, London, W1J 9DY. 020 7287 2300. Current show until 27 October – Michael Raedecker

Store Gallery, 27 Hoxton Street, London, N1 6NH. 020 7729 8171. Current show until 20 October - Chris Evan

The Serpentine Gallery, Kensington Gardens, London, W2 3XA. 020 7402 6075

Own Art Scheme –  www.artscouncil.org.uk

Frieze Art Fair, Regents Park, London – 11-14 October 2007

Coutts is also running a special ticket offer to this year’s Affordable Art Fair. Please  click here for more details.

By Michele Nevard